LABOUR FORCE PARTICIPATION AND THE JOB SEARCH THEORY: TESTS OF SOME NEGLECTED IMPLICATIONS Available to Purchase

The job search theory, as developed since the early 1960s, is primarily a theory predicting the behaviour of unemployed job‐seekers responding to the costs of acquiring information about the wage possibilities available to them. However, implications can be derived for the influence on the individual's labour force participation (LFP) decision of the factors used in search theory, and these implications have never been tested. This paper will present a number of hypotheses regarding LFP and then test these hypotheses against a broad and diverse cross‐section sample of male heads of households, using ordinary least squares regression analysis. The results generally confirm the hypotheses and the view that the variables of the job search theory have a significant influence on the LFP decision.